In response to realistic challenges, how can Chinese manufacturing remain competitive?
How can China's manufacturing remain competitive in the face of practical challenges | -- Two Sessions of China's economy Q&A No. 4
Manufacturing is the cornerstone of China's economy. Since last year, China's industrial economy has picked up and improved, but in the face of the extremely complex international situation and the external challenges of "decoupling and chain breaking", there have been continuous voices about "industrial chain relocation" and "China's manufacturing advantage is no longer".
In the government work report submitted for deliberation on the 5th, "vigorously promoting the construction of a modern industrial system and accelerating the development of new quality productivity" ranked first in the government's work tasks in 2024, releasing a clear signal of firmly building the foundation of the real economy.
From the new goals and new measures revealed in the report, to the case stories and professional interpretations brought by representatives, experts and scholars, and then to the interview and research of journalists at the front line, we have a clearer understanding of Chinese manufacturing to maintain competitiveness and achieve stable development.
In the face of change, strong resilience
Under the complex and severe external environment, the trend of China's manufacturing enterprises has attracted much attention.
"We have realized the localization of industrial robot controllers, servo systems, etc., and are accelerating the delivery speed to the sea and increasing the international market share." Zhang Jin, president of Shenyang Siasun Robot Automation Co., LTD., used his own case to show that in the field of robots that are competing for layout in developed countries, the core technology is firmly held and the industrial chain is complete, "even if the wind is surging, it can move forward steadily."
This is the portrayal of enterprises fighting the market, and it is also the epitome of Chinese manufacturing to meet challenges.
In the past year, the international environment was turbulent. The impact of geopolitics and great power competition is more and more obvious, the manufacturing industry in developed countries has returned, the rapid economic development of Mexico, Southeast Asia and other places, and the competition has been intensified. These are objective realities that should not be avoided. However, the rhetoric of singing down China's manufacturing and singing down China's economy is mixed among them, which needs to make a dialectical analysis.
In response to challenges and overcoming difficulties, China has achieved reasonable growth in the scale of its manufacturing industry and trade, and maintained an overall stable market share.
According to the heads of relevant ministries and commissions in the "ministerial channel" introduction, in 2023, China's total industrial added value is close to 40 trillion yuan, accounting for 31.7% of GDP. The manufacturing industry has ranked first in the world for 14 consecutive years.
"Important progress has been made in the construction of a modern industrial system", "a number of major industrial innovation achievements have reached the international advanced level"... A series of statements in the government work report highlight the solid pace of manufacturing in large countries.
Is there really a wave of "industrial chain transfer" as called by foreign media?
It is undeniable that due to cost and other factors, the production of some labor-intensive goods is transferred to other countries. However, because China is so deeply embedded in the global value chain, many companies have withdrawn from China and come back, or still need to import a lot of intermediate goods from China.
"Neither can we be partial and regard individual links as the overall trend, but we must also see the objective law of industrial development in which our industry is reshaping its competitiveness in the process of transformation and upgrading." Song Xiquan, chairman of Taihe New Materials Group Co., LTD., took the textile industry as an example, saying that although individual processing links have turned away, the overall added value is improving. In 2023, China's high-performance fiber production capacity accounted for more than one-third of the world, and exports in 2023 increased by 14.4% year-on-year.
Authoritative data show that in the current 500 kinds of major industrial products, China has more than 40% of the output of products ranked first in the world, personal computers, mobile phones, solar panels and other important products accounted for more than half of the world's output. Manufacturing accounts for more than 30% of the world's total.
The development of advanced manufacturing has accelerated, and the industrial chain of high-tech manufacturing has been further gathered. 45 national advanced manufacturing clusters and 178 national high-tech zones are laid vertically and horizontally, with clusters of chains. Last year, reflecting the industrial supporting and integration capabilities of the equipment manufacturing industry exports of 13.47 trillion yuan, "new three" products exports exceeded one trillion yuan.
"Taking China's new energy vehicles as an example, the smooth flow of the world depends on technology, quality and efficient synergistic industrial chain." Zhu Huarong, chairman of Changan Automobile, said that structural upgrading is becoming another important competitiveness of the manufacturing industry.
Does "decoupling break the chain" impact China's position in the global industrial chain supply chain? Made in China is also confident to answer -
Possessing all industrial categories in the United Nations Industrial Classification; In some key areas and key track to form a number of competitive industries with the whole industry chain; It has cultivated 12,000 specialized and special "little giant" enterprises, and more than 90% are supporting suppliers of well-known large enterprises at home and abroad.
Tesla Shanghai super factory, parts localization rate of more than 95%. Song Gang, Tesla's vice president of manufacturing, said Tesla and Chinese suppliers "live together and win."
"Thousands of basic products made in China are impossible to find alternative suppliers," the Spanish company Globo wrote on its website. According to the German Business Confidence survey 2023/24 released by the German Chamber of Commerce in China, more than half of the surveyed companies plan to increase investment in China in the next two years, one of the reasons is the improvement of the supply chain and the improvement of innovation.
"We have a complete industrial system, huge market size and other advantages, and the long-term fundamentals of the manufacturing industry are still solid." Zhang Li, president of the China Electronic Information Industry Development Research Institute, said that this is the base of Chinese manufacturing and resilience.
Respond to challenges and maintain "stability"
To hold on to the existing advantages, we must maintain the "steady" concentration. In the face of the deep adjustment of the global industrial chain and supply chain pattern, how will major manufacturers respond with "stability"?
-- First, the volume must be stable. "Maintain the stable operation of the industrial economy", the government work report released the policy signal of stable growth.
Minister of Industry and Information Technology Jin Zhuanglong said at the "ministerial channel" of the second session of the 14th National People's Congress held on the 8th that this year will deeply implement the work plan for stable growth of the ten industries, and encourage large industrial provinces and industrial cities to "bravely pick the big beam".
The traditional industry accounts for more than 80% of the manufacturing industry, is the basis of the modern industrial system, related to economic development and the people's livelihood, is the basic plate for China to maintain the position of the world's first manufacturing power, can not take the traditional industry as a "low-end industry" simple exit. The report identifies a series of deployments aimed at promoting the transformation and upgrading of traditional industries.
Through the adjustment of the traditional industrial structure, the old industrial base Fushun has gained new vitality. Representative Gao Jian, mayor of Fushun City, said that it is building a national high value-added new raw material base and planning new advantages.
-- We need to have a complete system and maintain the integrity of the industrial system.
In 2023, the output value of the new ecological aluminum industry in Baise City, Guangxi Zhuang Autonomous Region exceeded 120 billion yuan, based on the rich characteristics of bauxite resources, forming a complete industrial chain from aluminum resources to deep processing.
The report proposed to "enhance the capacity of Northeast and central and western regions to undertake industrial transfer", and make deployment for cultivating and expanding advanced manufacturing clusters. "This will further promote the formation of an industrial pattern of reasonable regional division of labor and interconnected development." Ge Guoke, mayor of Baise, said that Baise is making every effort to promote the construction of the Baise area of the China-Asean Industrial Cooperation Zone and build a highland to undertake industrial transfer at home and abroad.
-- It is more important to strengthen the chain and enhance industrial competitiveness.
The Ministry of Industry and Information Technology said it will vigorously implement high-quality development actions for key industrial chains in the manufacturing industry. One chain and one policy, make up the short board, forge the long board, strengthen the foundation, and enhance the toughness and competitiveness of the industrial chain and supply chain.
"This year, we will completely remove restrictions on foreign investment in the manufacturing sector, and we are also preparing to pilot the opening of value-added telecommunications services such as Internet data centers." Jin Zhuanglong said.
Seize the opportunity to develop new quality productive forces
At the important threshold of climbing to the middle and high-end, China's manufacturing must accelerate the formation of new quality productivity.
The government work report clearly proposed that "give full play to the advantages of the new national system and comprehensively enhance the capacity for independent innovation." From "strengthening the systematic layout of basic research" to "supporting powerful enterprises to take the lead in major research tasks", the report proposes a series of measures.
Pilot test, product from research and development to production must be the only way. Due to the high investment, many enterprises lack the ability of pilot test. Focusing on this "pain point", the report clearly "accelerate the systematic layout of major scientific and technological infrastructure, and promote the construction of common technology platforms and pilot test verification platforms."
This year, the Ministry of Industry and Information Technology will continue to implement major scientific and technological projects and key research and development plans, build a number of national manufacturing innovation centers, develop high technology, achieve industrialization, and accelerate the development of new quality productivity.
Focus on emerging industries and future industries, and cultivate more new racetracks.
"Actively build new growth engines such as bio-manufacturing, commercial aerospace, and low-altitude economy", "open up new racetracks such as quantum technology and life science", and "create a number of future industrial pilot areas"... The report focuses on actively cultivating emerging industries and future industries, with concrete measures and detailed deployment.
"It is imperative to win the development opportunities and compete for technological heights." Huang Li, chairman of Wuhan Gaord Infrared Co., LTD., said that this year, enterprises should make efforts in low-altitude economy, brain-computer interface and other fields.
The head of the Ministry of Industry and Information Technology said that it will speed up the supply of cutting-edge technologies and common technologies, cultivate advantageous enterprises, and improve the industrial ecology. In terms of future industries, general artificial intelligence, humanoid robots, brain-computer interfaces, etc., will be the next key layout direction. We will regularly release a catalogue of cutting-edge technology promotion, build application test grounds around key areas, and accelerate industrial cultivation.
Seize digital opportunities and accelerate "AI +".
China has built the world's largest information and communication network, with the world's second largest computing power, and extensive and profound digital transformation is one of the most powerful drivers for manufacturing upgrading.
"To seek" new "with" number "and to add" number "to" real "is the inevitable industrial transformation, but also the key to building new advantages for development." Representative Miao Wei, senior vice president of ZTE Corp., said that with good use of new production tools, we are confident to base ourselves on the foundation, seize opportunities and accelerate development.